People with American citizenship who are late in applying for a Social Security Number (SSN) for the year 2020 will no longer be eligible for Corona aid despite filing a tax return. The Internal Revenue Service (IRS) has tightened the rules and now requires that the SSN be applied for before the due date of the tax return.
People who are aware that they have American citizenship but are late in applying for an SSN (Social Security Number) to be eligible for coronavirus aid are out of luck.
The IRS (Internal Revenue Service) has tightened the rules and now requires that the SSN must be applied for before the due date of the tax return. If this is not the case, no Corona aid will be received, despite filing a tax return and being American.
This also applies to people who discovered that they had American citizenship because they were born in America and moved at a very young age, or because they were born to an American parent.
It is possible for people with American citizenship to use the so-called Streamlined Procedure. For this, they must file tax returns for the past three years and submit bank accounts (FBAR) going back six years.
Once this has been done, they will receive all the Corona aid they were entitled to up to the beginning of 2023, taking into account the income threshold. A plaster on the wound to soften the high cost of filing a tax return.
Since the beginning of this year, the IRS has tightened its rules and one can no longer claim coronasteun if the SSN is not obtained on time (see IRS publication). If this is not the case, the taxpayer will not receive any Corona aid, not even the last support of $1400. If the aid has been applied for, the taxpayer usually receives a rejection letter from the IRS.
A valid SSN for the Recovery Rebate Credit that is applied for on a tax return is an SSN that was issued before the due date of that return. This means in practice that the last coronavirus aid of $1400 will only be received under the Streamlined Procedure if the SSA (Social Security Administration) issued the SSN voor June 15, 2022. If the SSN is only issued after June 15, 2022, the taxpayer will not receive any coronavirus aid at all, despite filing a tax return for those years and being American in those years.
This is a huge disappointment for people who have counted on this amount. If the aid has been applied for in the tax return, the taxpayer usually receives a letter from the IRS rejecting the aid.
Below is an overview:
|Before 6/15/2021||You are in possibly entitled to the Cares checks for both 2020 and 2021|
|After 06/15/2021, but before 6/15/2022||You are possibly entitled to a Cares check for 2021 only|
|After 6/15/2022||You are most likely no longer entitled to the Cares checks at all|
Note: In addition to the issue date, the first set of conditions for receiving Corona aid also apply, such as an income limit.
We, the founders of Americans Overseas, were born in the Netherlands and obtained our American nationality through our (American) mother. When we heard about this for the first time around 2013, we were in total disbelief (it can’t be true!), anger (how can they do this?), fear (am I going to get fined or pick up other problems?), and panic (what should I do?).
It is (unfortunately) true that there is an additional American tax levy. But there’s no information from the local government, and when approached, the consulate referred us to the IRS, and the IRS was impenetrable.
That’s why we started this initiative to help people from all over the world by providing proper information to avoid unnecessary panic, and offering help free of obligation and free of charge. If needed, we have a network of affordable professionals (accountants) who can help you with your tax obligations.
If you have more questions about the US exit tax and the US tax obligation, you can contact us at Americans Overseas.
Understanding the US tax system, the obligations, and all the additional terms can be difficult. Especially if one lives outside of America. Is your question not answered? Contact us.
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